KRAKATOA RESOURCES LIMITED — Capital/Financing Update 2021

Apr 12, 2021

==> picture [188 x 33] intentionally omitted <==

==> picture [103 x 90] intentionally omitted <==

13 April 2021

RC Drilling Underway at Rand Gold Project

• 2,760m of Air-Core (AC) drilling now completed over the magnetic “bullseye” targets defined by the recent aeromagnetic and induced polarization surveys;

• ~1,500m of Reverse Circulation (RC) drilling for 10 holes has commenced;

• The RC program is targeting the historical workings at Bulgandry including the Goodwood and Lone Hand Reef mine areas where no drilling has ever been done despite historical production gold grades of up to 265g/t.

KTA (or “the Company”) is pleased to provide an update on its maiden drilling program at the Rand Gold Project in the Lachlan Fold Belt, NSW.

The drilling program of 43 AC holes, for a total of 2,760 metres has now been completed over the magnetic bullseye target area, north of the Rand township. Following on from this, RC drilling has now commenced over the Bulgandry Goldfield area, see photograph 1. The RC drilling program of up to 10 holes for 1,500 metres is targeting magnetic linements below the historical mines most of which have never been drilled, despite recorded head grades of up to 265g/t gold, see figure 1.

==> picture [483 x 322] intentionally omitted <==

Photograph 1: RC Drilling Underway at Drillhole KBRC001

==> picture [30 x 29] intentionally omitted <==

ASX Code Capital Structure 278,950,000 Fully Paid Shares KTA, KTAOC 82,800,000 Options @ 5c exp 31/07/21 5,000,000 Options @ 7.5c exp 31/07/21 16,200,000 Options @ 7.5c exp 29/11/23 15,000,000 Performance Rights at 20c, 30c and 40c.

==> picture [53 x 41] intentionally omitted <==

1

==> picture [595 x 103] intentionally omitted <==

==> picture [483 x 295] intentionally omitted <==

Figure 1: Priority exploration targets (Bullseye Magnetic and Bulgandry Goldfield), on Aeromagnetic TMI-RTP

The completed AC program was designed to test for IRGS mineralisation associated with discrete bullseye magnetic (high) anomalies under thin transported cover. Additionally some holes were configured to test for “deep lead” alluvial gold in palaeochannels, and other anomalies defined in the recent IP geophysical survey. All AC holes were drilled vertically to blade refusal, which ranged from approximately 45 to 96 metres.

All AC samples with the execption of the last 7 holes have been sent to ALS Global, with the last batch of samples due for delivery this week. All laboratories are currently backlogged, stretching the return assays estimated time of arrival to within 6-8 weeks.

Authorised for release by the Board.

FOR FURTHER INFORMATION:

Colin Locke Executive Chairman +61 457 289 582 locke@ktaresources.com

2

==> picture [595 x 103] intentionally omitted <==

Disclaimer

Forward-looking statements are statements that are not historical facts. Words such as "expect(s)", "feel(s)", "believe(s)", "will", "may", "anticipate(s)" and similar expressions are intended to identify forward-looking statements. These statements include, but are not limited to statements regarding future production, resources or reserves and exploration results. All of such statements are subject to certain risks and uncertainties, many of which are difficult to predict and generally beyond the control of the Company, that could cause actual results to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. These risks and uncertainties include, but are not limited to: (i) those relating to the interpretation of drill results, the geology, grade and continuity of mineral deposits and conclusions of economic evaluations, (ii) risks relating to possible variations in reserves, grade, planned mining dilution and ore loss, or recovery rates and changes in project parameters as plans continue to be refined, (iii) the potential for delays in exploration or development activities or the completion of feasibility studies, (iv) risks related to commodity price and foreign exchange rate fluctuations, (v) risks related to failure to obtain adequate financing on a timely basis and on acceptable terms or delays in obtaining governmental approvals or in the completion of development or construction activities, and (vi) other risks and uncertainties related to the Company’s prospects, properties and business strategy. Our audience is cautioned not to place undue reliance on these forward-looking statements that speak only as of the date hereof, and we do not undertake any obligation to revise and disseminate forward-looking statements to reflect events or circumstances after the date hereof, or to reflect the occurrence of or non-occurrence of any events.

Competent Person Statement

The information in this announcement is based on information compiled by Mr Mark Major, a geologist, who is a Member of the Australasian Institute of Mining and Metallurgy (AusIMM) and employed as CEO of Krakatoa Resources Pty Ltd, and is an accurate representation of the available date and studies for the claim blocks. Mr Major has sufficient experience relevant to the style of mineralisation and type of deposit under consideration, and to the activity which he has undertaken, to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Major consents to the inclusion in this announcement of the matters based on this information in the form and context in which it appears.

3

==> picture [188 x 33] intentionally omitted <==

==> picture [103 x 90] intentionally omitted <==

ABOUT KRAKATOA:

Krakatoa is an ASX listed public Company focused on copper-gold exploration in the world class Lachlan Fold Belt, NSW and multielement metals including the increasingly valued rare earths in the highly prospective Narryer Terrane, Yilgarn Craton, WA.

Belgravia Cu-Au Porphyry Project (Krakatoa 100%); Lachlan Fold NSW

The Belgravia Project covers an area of 80km[2] and is located in the central part of the Molong Volcanic Belt (MVB), East Lachlan province, between Newcrest Mining’s Cadia Operations and Alkane Resources Boda Discovery. The Project target areas are considered highly prospective for porphyry Cu-Au and associated skarn Cu-Au, with Bell Valley and Sugarloaf representing the two most advanced target areas. Bell Valley contains a considerable portion of the Copper Hill Intrusive Complex, the interpreted porphyry complex which hosts the Copper Hill deposit (890koz Au & 310kt Cu) and has highly prospective magnetic low features spanning 6km. Sugarloaf contains a 900m Deep Ground Penetrating Radar anomaly located within a distinctive magnetic low feature considered characteristic of a porphyry-style deposit and co-incident with anomalous rock chips including 5.19g/t Au and 1.73% Cu.

Turon Gold Project (Krakatoa 100%); Lachlan Fold NSW

The Turon Project covers 120km[2] and is located within the Lachlan Fold Belt’s Hill End Trough, a north-trending elongated pull-apart basin containing sedimentary and volcanic rocks of Silurian and Devonian age. The Project contains two separate north-trending reef systems, the Quartz Ridge and Box Ridge, comprising shafts, adits and drifts that strike over 1.6km and 2.4km respectively. Both reef systems have demonstrated high grade gold anomalism (up to 1,535g/t Au in rock chips) and shallow gold targets (up to 10m @ 1.64g/t Au from surface to end of hole).

Rand Gold Project (100%); Lachlan Fold NSW

The Rand Project covers an area of 580km[2] , centred approximately 60km NNW of Albury in southern NSW. The Project has a SW-trending shear zone that transects the entire tenement package forming a distinct structural corridor some 40 km in length. The historical Bulgandry Goldfield, which is captured by the Project, demonstrates the project area is prospective for shear-hosted and intrusion-related gold. Historical production records show substantial gold grades, including up to 265g/t Au from the exposed quartz veins in the Show Day Reef.

Mt Clere REEs, HMS & Ni-Cu-Co, PGEs Project (100%); Gascoyne WA

The Mt Clere REE Project located at the north western margins of the Yilgarn Graton. The company holds 1,780km[2] of highly prospective exploration licences prospective for rare earth elements, heavy mineral sands hosted zircon-ilmenite-rutile-leucoxene; and gold and intrusion hosted Ni-Cu-Co-PGEs. Historical exploration has identified the potential presence of three REE deposits types, namely, Ion adsorption clays in extensive laterite areas; monazite sands in vast alluvial terraces; and carbonatite dyke swarms.

The information in this section that relates to exploration results was first released by the Company on 19 June 2019, 25 November 2019, 3 December 2019, 14 April 2020, 20 May 2020, 26 June 2020 and 6 July 2020. The Company confirms that it is not aware of any new information or data that materially affects the information included in the relevant market announcements.

4